Anixa Biosciences(ANIX) - 2019 Q4 - Annual Report

Financial Performance - In fiscal year 2019, the company recorded revenue of $250,000 from one license agreement, a decrease of approximately 77.5% compared to $1,113,000 from two license agreements in fiscal year 2018[127] - Inventor royalties and contingent legal fees related to patent assertion activities decreased by approximately $602,000 to approximately $166,000 in fiscal year 2019, down from approximately $768,000 in fiscal year 2018[128] - Research and development expenses decreased by approximately $1,340,000 to approximately $5,473,000 in fiscal year 2019, compared to approximately $6,813,000 in fiscal year 2018[130] - General and administrative expenses decreased by approximately $1,249,000 to approximately $5,663,000 in fiscal year 2019, down from approximately $6,912,000 in fiscal year 2018[131] - Interest income increased to approximately $71,000 in fiscal year 2019, compared to approximately $46,000 in fiscal year 2018, due to an increase in funds available for short-term investments[134] - Cash used in operating activities was approximately $4,773,000 during the year ended October 31, 2019[138] - Cash provided by financing activities was approximately $5,734,000, resulting from the sale of 1,363,872 shares of common stock in an at-the-market equity offering[138] - The company raised approximately $5,527,000 through an at-the-market equity offering during fiscal year 2019[136] - The impairment in carrying amount of patent assets was approximately $419,000 in fiscal year 2019, compared to approximately $583,000 in fiscal year 2018[133] - The net loss attributable to noncontrolling interest decreased by approximately $75,000 to approximately $172,000 in fiscal year 2019, from approximately $247,000 in fiscal year 2018[135] Corporate Governance - Management assessed the effectiveness of internal control over financial reporting as of October 31, 2019, concluding it was effective[148] - No changes in internal control over financial reporting during Q4 2019 that materially affected the company's controls[149] - The company entered into a settlement regarding a shareholder derivative complaint, agreeing to changes in corporate governance policies[164] - The Nominating Committee is responsible for identifying qualified individuals for board membership, composed exclusively of independent directors[168] - The company has established a formal code of ethics applicable to its principal executive and financial officers, available upon request[166] - The Audit Committee is composed of independent directors, with David Cavalier serving as the Chairman and qualifying as an Audit Committee financial expert[173] - The company evaluated the effectiveness of its disclosure controls and procedures, concluding they were effective as of the end of fiscal year 2019[147] - The company has no significant employees other than its executive management team[160] - There are no family relationships among the directors or executive officers of the company[161] - The Company will hold an advisory vote on named executive officer compensation every year until at least the Annual Meeting of Shareholders in 2025[151] - The 2020 Annual Meeting of Shareholders is scheduled for July 15, 2020, with a deadline for shareholder proposals set for May 11, 2020[151] Leadership and Board Composition - Dr. Amit Kumar has served as CEO since July 2017 and has extensive experience in technology-driven startups and biotechnology[153] - Lewis H. Titterton has been a director since 2017 and has over 40 years of experience in the technology industry[155] - David Cavalier, a director since 2018, has over 20 years of experience in biotechnology and was instrumental in securing a $118 million contract from the U.S. Government[157] - Emily Gottschalk, a director since 2019, has developed over 150 million CDs/DVDs for the U.S. retail market since 1997[157] - Dr. John Monahan has served on the Board since 2016 and has over 50 publications in scientific literature[157] - The Chief Operating Officer and Chief Financial Officer, Michael J. Catelani, has over 30 years of experience in finance and operations, previously managing a $150 million drug development collaboration with Pfizer[159] - The Company has a diverse board with members having backgrounds in biotechnology, finance, and healthcare, enhancing its strategic development capabilities[153] - The Board of Directors includes members with extensive experience in public companies and biotechnology, contributing to informed decision-making[159] - Michael J. Catelani has been the Chief Operating Officer since July 2017 and Chief Financial Officer since November 2016, with over 30 years of experience in finance and operations[159] - David Cavalier, a director since September 2018, was instrumental in securing a $118 million advanced research and development contract from the U.S. Government in 2011[157] Legal and Compliance Matters - A putative shareholder derivative complaint was filed alleging breach of fiduciary duty and unjust enrichment against certain current and former officers and directors[164] - The company entered into a settlement on August 21, 2019, agreeing to changes in corporate governance policies and to reprice certain stock options to $0.67[164] - All claims in the derivative action have been dismissed, with individual defendants denying any wrongdoing[164] - The company believes all required Section 16(a) reports were made on a timely basis during fiscal year 2019[165] - The Nominating Committee considers candidates' integrity, experience, and ability to contribute to the board's diversity[168] - The company has not engaged any third party to assist in identifying or evaluating director nominees[170]